Date | Item | Actions needed | Taking Action | Articles From Library |
__/__ | Asset allocation
How your investments are divided between equities, fixed income and cash investments will greatly affect your returns and risks. Be sure your allocation properly reflects your time horizon and risk tolerance. |
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2. 3. | Meet with a financial advisor to help you create an asset allocation and investment strategy that is suited for your needs. | Asset Allocation Financial Market Indicators |
__/__ | Equity diversification
Do you own enough different stocks to reduce the potential impact of one poorly performing stock without owning so many that it is impossible to monitor them? Many advisors suggest owning at least a couple of stocks in at least 4 to 6 industries. |
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2. 3. | Meet with an investment professional to review your current stock holdings. | Investment Portfolio Diversification Building a Stock Portfolio |
__/__ | Review of individual stocks
Review your thoughts on why you originally bought each stock to determine if the reasons are still valid. Have there been fundamental changes in the company's business or changes in its industry that should prompt a deeper analysis of the company. |
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2. 3. | Meet with an investment professional to review your current stock holdings. | Building a Stock Portfolio |
__/__ | Bond maturities
Remember that bond values change in the opposite direction of changes in interest rates. Should you adjust your bond maturities in light of the current interest rate environment? Consider using a "ladder of maturities" approach to improve your overall yield without taking excessive interest rate risk. |
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2. 3. | Meet with an investment professional to review your current bond holdings and to evaluate your level of interest rate risk. | Investing in Bonds Interest Rate Risk Investing in US Treasuries |
__/__ | Taxable vs. tax free bonds
Is your tax bracket high enough to justify owning tax-free bonds instead of taxable bonds? |
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2. 3. | | Investing in Municipal Bonds Comparing Taxable and Tax-Free Yields |
__/__ | Cash positions
Short-term interest rates are very low. Examine whether using CDs could improve the return on funds currently in money market funds or savings accounts. Factor liquidity needs into your decision-making. |
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2. 3. | Review the rates on checking accounts, savings accounts and Certificates of Deposit. | Choosing the Right Accounts for Your Cash Building a Ladder of Savings Certificates |
__/__ | Tax issues
Are there capital losses you can and should take? Net capital losses can offset other income up to $3000 with unused amounts carried forward. When considering selling a stock for a gain, do you consider that holding the stock for more than a year will enable you to use the lower long-term capital gains tax rates? |
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2. 3. | | Understand the Tax Implications of Financial Decisions Taxable, Tax Advantaged, Tax Deferred and Tax Free |
__/__ | Broker review
The recent stock market has not been easy for anyone, including your broker. However, as a client, you deserve attention and service. Does the broker stay in touch? Has the broker been responsive to your inquiries? Do you believe your broker can provide the expertise and service you need? |
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2. 3. | Meet with an investment professional and ask the right questions to make sure your advisor is the right one for you. | |
__/__ | Mutual funds
Are your reasons for selecting your mutual fund investments still valid? Have there been changes in the nature of the fund or the portfolio manager that should be evaluated? Are there other funds within the "mutual fund family" that are better suited for your needs and that you could switch to without incurring another commission? Are you considering using "dollar cost averaging" as a way to make new mutual fund purchases? |
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2. 3. | Meet with an investment professional to review your current funds and identify any changes that may be appropriate. | Investing in Mutual Funds Dollar Cost Averaging Mutual Funds and Income Taxes |
__/__ | Investments within IRAs
Have you included your IRA holdings in determining your overall investment strategy? If you own CDs within your IRA, have you chosen maturities that provide the best returns? Are the mutual funds, stocks or other investments in your IRAs still appropriate? |
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2. 3. | Review the rates on IRA Certificates of Deposit. | Asset Allocation Building a Ladder of Savings Certificates |
__/__ | Investments within employer retirement plans
Have you included your retirement plan holdings in your overall investment strategy? Are the investments or mutual funds currently in your plan still appropriate? Have you recently reviewed how current additions to your plan are being invested? |
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2. 3. | Meet with a financial advisor to determine how the investments within your employer plan fit within your overall investment strategy. | Take Full Advantage of Your Employer's 401(k) Plan |
__/__ | Periodic monitoring
Do you regularly review your investments and your investment strategy? How has your portfolio performed recently, both on an absolute basis and in comparison to general market conditions? Consider creating a written "investment history" with reasons for your investment decisions. It could help identify what is working and what is not working. |
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2. 3. | Meet with an investment professional to analyze how your investments have performed and how they fit within your total financial plan. . | The Personal Balance Sheet can be downloaded and printed to help you track the results of your investments and your total financial condition. |
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